CLEARING UP
When the Republican state convention assembled on July 28, 1875, its
first informal ballot virtually selected the successor of Cushman K.
Davis in the governorship. The distinction fell on John Sargent
Pillsbury, who had proved his capacity for public affairs by ten years’
service in the state senate and on the board of regents of the
university. A successful business career, a reputation for inflexible
integrity, a power to select from varied propositions the one which
could be carried and worked, and a keen insight into human nature gave
him an influence with legislatures and the people rarely equaled. Two
reëlections were accorded him as by common consent. The varied events
and incidents of his six years’ service are so related that, while
forming a whole, they may be thrown into convenient groups.
After the harvest of 1875 Governor Davis appointed a commission to
investigate the locust devastations, and placed on it Allan Whitman of
St. Paul, a man of science. The report, by giving in simple language an
account of the vermin, their manner of propagation, and the stages of
their growth, suggested the principles upon which their ravages might
be restricted, and, when new invasions did not take place, actually
repressed. Early in the season of 1876 Governor Pillsbury issued a
proclamation commending to the farmers of the infested districts the
advice of the commission to attack the “hoppers” immediately after
hatching. By digging ditches around fields and gardens not infested,
the vegetation could be protected. For the rescue of crops somewhat
grown he recommended a simple apparatus which got the popular name of
“hopperdozer.” It consisted of a piece of sheet-iron twelve feet long
or more, turned up on the back edge and ends. By means of ropes
attached to the front edge, at or near the ends, it could be hauled by
men or animals over the surface of the field. The upper surface of the
pan, smeared with coal tar, imprisoned the insects till they could be
scraped out at convenient intervals. By such simple devices
considerable areas of crops were rescued from total destruction. They
were of course useless after the appearance of wings on the creatures;
and the havoc of the previous season was repeated, particularly in the
southwestern counties. These Governor Pillsbury visited in person, and,
after witnessing the ruin and distress going on, called for
contributions in relief. The response was immediate and generous, and
with the aid of his wife the governor attended personally to the
distribution. The damage extended in this year to twenty-nine counties
south of Otter Tail Lake and west of the watershed of the Mississippi.
The worst of all was that at the close of the season these counties
were “literally peppered” with locust eggs. The outlook for the coming
season caused deep anxiety. The legislature of 1877 authorized a loan
of $75,000 to be advanced to farmers for seed, and empowered county
commissioners to levy a tax for the destruction of locusts and their
eggs. In the spring the hatching began in alarming volume. Governor
Pillsbury, in the expectation that the expense would be reimbursed,
distributed 56,000 pounds of sheet iron and 3000 barrels of coal tar
for “dozers.” Where these were diligently operated the damage to crops
was reduced.
On April 10, 1877, in response to an expressed desire of various
religious bodies, Governor Pillsbury appointed the 26th of that month
as a day of fasting, humiliation, and prayer: “In the shadow of the
locust plague,” said he, “whose impending renewal threatens the
desolation of the land, let us humbly invoke for the efforts we make in
our defense the guidance of that hand which alone is adequate to stay
the pestilence.” The day was observed in a goodly number of
congregations, but there was no great and general humiliation of the
people, and there was no immediate evidence of supernatural
interference. The infernal brood grew wings and began their aerial
excursions in various directions. In the last days of June the swarms
began rising high in the air and taking flight on different bearings.
In the course of sixty days all had so risen and flown out of the state
to unknown destinations. Although they had wrought damage equal at
least to that of any previous year of their residence in Minnesota, the
state as a whole harvested the greatest wheat crop in her
history,—30,000,000 bushels, of sixty-three pounds to the bushel.
In spite of the ruin wrought in so large a portion of her territory,
and of minor and ordinary losses, the period in view was one of
prosperity. The population, which had risen from 439,706 in 1870 to
597,407 in 1875, increased to 780,773, according to the census of 1880.
The wheat crop, which had been 30,000,000 bushels in 1877, touched
40,000,000 in 1880. The most striking evidence of material development
is seen in railroad building. In the four years 1873-76 but 87 miles
had been added to the 1900 miles of construction in the eleven years
ending with 1872. This mileage was increased in the six years beginning
with 1877 to 3278; 446 were added to the St. Paul and Pacific (now
Great Northern) system.
* * * * *
How a corporation left in the panic year 1873 in a condition of
hopeless bankruptcy was resuscitated and put into vigorous life is a
story which the reader will be interested in. The “Division roads,” the
main line from St. Paul to Breckenridge and the branch to St. Cloud,
had gone into a receiver’s hands in August, 1873. The “Extensions” to
St. Vincent and Brainerd, of which 140 miles in detached portions had
been built, remained in the control of the stockholders till October,
1876, when they were turned over to trustees of the bondholders,
according to the terms of the company’s contract with them. These
trustees employed as their general manager the same gentleman who for
three years had been receiver of the Division roads. The stockholders
having given over the task of completing the roads and retaining
ownership, it remained for the bondholders to decide between putting in
several more millions of dollars to complete and equip the roads, or
giving up and letting the property go to sale under pending foreclosure
proceedings. Had they taken the former course and selected honest and
capable agents, they would have not merely escaped great losses but
realized large profits. The greater portion of the bonds of the system,
over $17,000,000, were owned in Holland, and they had been placed by
their holders in the hands of a syndicate of Dutch bankers to be
controlled for the common interest.
The drift of affairs had been watched by three deeply interested
persons. Donald A. Smith, residing at Winnipeg and representing that
city in the Dominion parliament, was chief commissioner of the Hudson’s
Bay Company. That company had many millions of acres of land in
Manitoba, and was desirous to obtain railroad connections through
Minnesota with the outside world. He particularly desired the
completion of the St. Vincent Extension. Another was Norman W. Kittson,
an old associate of Sibley in the fur-trade and politics, still
interested in the Red River trade. The third was James J. Hill, who had
come from Canada to Minnesota as a boy of eighteen in 1856. He had been
in Mr. Kittson’s employ in his Red River business, had built up a rival
line of steamboats and barges, and made it for Mr. Kittson’s interest
to take him into partnership. These three men had journeyed up and down
the Red River till they knew every foot of the stream and the lands
drained by it. Early in 1874 Mr. Smith asked Messrs. Kittson and Hill
to collect for him all the information accessible in regard to the St.
Paul and Pacific system, its lines completed or unfinished, its
terminals, equipment, land grants, and in particular the stock and
bonds. The consultations which followed were fruitless. “There seemed
no way to get in.”
Two years later, when it became evident that the Dutch bondholders were
bound to realize what they could and let the properties go, there
appeared a way to get in. 1876 was one of the grasshopper years in
Minnesota. The crop was light and prices were low. Rates and fares were
so high as to discourage railroad traffic. The net earnings of $300,000
on the system were a drop in the bucket compared with the interest
charges of nearly $2,000,000. In March, 1876, Mr. Hill and Mr. Smith
were again in consultation, and resolved on an effort to obtain control
by buying all, or nearly all, the bonds held in Holland. Delays and
discouragements postponed action. It was not till May, 1877, that Mr.
George Stephen, president of the Bank of Montreal, was induced to
consider taking a hand in the deal. In September, after a visit to
Minnesota, he went to England in full expectation of enlisting the
necessary capital, the Dutch committee having accepted a conditional
offer of cash for their holdings. To his surprise Mr. Stephen found no
English capitalists willing to send good money where so much bad money
had gone. To all appearance the project was a failure. The associates,
however, learning that the Dutch were still fierce to sell, submitted
to them in January, 1878, a proposition to buy their bonds at agreed
prices and pay in the bonds of a new company to be formed, which should
buy the properties at the now impending foreclosure sales. As a
“sweetener” they were willing to throw in $250 of six per cent.
preferred stock with every $1000 bond of the new company.
In the articles of agreement signed March 13, 1878, the Dutch committee
agreed to this proposition and consented to extend the time of payment
for their bonds six months after the last of the six foreclosure sales.
For their 17,212 one thousand dollar bonds, including coupons for
unpaid interest, they accepted $3,743,150. The associates bought large
amounts of “minority bonds” at similar figures. As they agreed to pay
interest on the bonds of the new company at seven per cent., they were
empowered to take immediate control and operation of the completed
lines and to resume construction on the St. Vincent Extension, whose
completion was greatly desired. On May 23, 1879, the St. Paul,
Minneapolis and Manitoba Railway Company was organized, and at the
foreclosure sales in the following month bought all the franchises and
assets of the expiring St. Paul and Pacific Railroad Company, including
those of the Division lines. Mr. James J. Hill at once became the
general manager of the roads, and began a career of railroad operation
with few if any equals in the country. Better times had come, but it
was mainly the vigor, economy, and discipline of the management which
soon swelled the earnings into millions.
The great financial exploit of the “associates” was followed by
tedious, exasperating, and costly litigation. About the time of the
foreclosure sales in June, 1879, Jesse P. Farley, who had been receiver
of the Extension roads and general manager of the Division lines,
brought suit in the district court of Ramsey County against Messrs.
Kittson and Hill to recover from them one third of all moneys,
securities, and effects which were accruing to them from the operation.
In his complaint Mr. Farley alleged that “in the summer of 1876” a
parol agreement had been made by the defendants and himself to
undertake jointly the purchase of the bonds of the two railroad
companies, the three to share equally in the net proceeds. In his
testimony, he deposed that the two defendants had no knowledge of the
great opportunity until revealed by him at the time mentioned. It was
because of his intimate knowledge of the affairs of the companies, of
his understanding of railroad finance, and his long experience as a
railroad manager, that they were unwilling to make any adventure
without his coöperation; and, to induce him to enter into the contract,
they agreed to consider his knowledge and skill equivalent to the money
they would severally procure. This part of the bargain was to remain a
secret. The defendants denied that any such contract had been made, or
that any conversation in relation to such an agreement had ever been
had. They had been familiar with the condition and finances of the
companies long before the time of the alleged contract. The district
court found in favor of the defendants, as also did the Supreme Court
of Minnesota on appeal. The Supreme Court, however, appears to have
considered that there was a contract between the parties, but that it
aborted when in the late fall of 1877 the “associates” were balked in
the effort to borrow money in England with which to buy the bonds for
cash.
Encouraged by this recognition of a contract, Mr. Farley brought suit
in the United States District Court for Minnesota in December, 1881,
setting up substantially the same allegations. Defeated here, he took
an appeal to the Supreme Court of the United States, which in 1887
remanded the suit to the Circuit Court for a novation of proceedings.
The printed pleadings, testimony, exhibits, and arguments fill more
than five thousand octavo pages. The Circuit Court held with the
defendants that no contract had been made, and that the plaintiff,
standing in the relation of a trustee, could not honorably or legally
have embarked in any such enterprise.
When Farley’s appeal reached the Supreme Court of the United States, in
October, 1893, that tribunal sustained the decision of the Circuit
Court so far as it denied the making of the alleged contract. The
plaintiff had not proven his allegations, and his story was inherently
improbable. The court had no occasion to pass on the impropriety of an
agreement never made.
* * * * *
In his inaugural address of 1870 Governor Austin mentioned as a
notorious fact the frequency with which county treasurers retired from
office with much more wealth than they possessed at the time of their
elections. To secure this office, caucuses and conventions were packed
and votes secured by methods little short of outright bribery. But
there was no response from the legislature. It was not till Governor
Pillsbury’s second term that the legislature of 1878 yielded to his
urgent recommendations and passed the act providing for a public
examiner. It was made the duty of this officer to supervise the
bookkeeping of all state banks and institutions and all state and
county auditors and treasurers. He was authorized to prescribe correct
and uniform methods of bookkeeping. He was required to visit all these
institutions and officials without previous warning, and verify and
inspect all the moneys, assets, and securities held by them
respectively. His powers extended to railroad companies, so far as the
exaction of gross-earnings taxes was concerned. The first appointee,
Henry M. Knox, performed the duties with such intelligence and industry
as to place the state under lasting obligations. In his last message
(1881) Governor Pillsbury expressed his satisfaction over the operation
of the law by saying: “No single act of legislation in this state has
ever been productive of more good in purifying the public service than
the creation of the office of public examiner.”
The penalty for homicide in the first degree had, from the beginning of
organized government in Minnesota, been death without alternative. An
act of March 5, 1868, laid on the trial jury the duty of deciding
whether the convicted murderer should suffer death or imprisonment for
life. Governor Davis in two messages strongly denounced this leaving
the penalty for murder to the caprice of juries, citing a case in which
one of three convicts equally guilty was put to death, while the others
received a sentence of life imprisonment. A tragical incident brought
the attention of a later legislature to the matter and caused a return
to traditional policy. On September 6, 1876, eight men from Missouri,
armed and mounted, rode into the village of Northfield in Rice County.
Two of their number entered the bank and ordered Heywood, the cashier,
to deliver the money. On his refusal they shot him dead and wounded his
assistant. Securing a small amount of booty, the robbers passed out to
find their companions engaged in a fusillade with citizens who had
found arms and chosen points of vantage. One unarmed citizen had
fallen, and two of the bandits had dropped dead from their horses. The
survivors rode away with all possible speed, firing at citizens who
showed themselves on the streets. After a pursuit of some days, four of
the bandits were surrounded in a swamp near Mankato. One was killed and
three brothers named Younger were captured. Two had evaded pursuit and
escaped from the state. Upon arraignment the three Youngers pleaded
guilty, and, as there was no occasion for a jury, received sentences of
life imprisonment. They were model prisoners. One died in 1889, another
committed suicide in 1902, and the third was pardoned in 1903.
* * * * *
The political campaign of 1878 in the third (the Minneapolis) district,
was diversified by a personal contest of more than local interest. The
Republican candidate for representative in Congress was William D.
Washburn, who had been an aspirant in 1868, but declined the candidacy
because of the great defection led by Ignatius Donnelly. The Democrats,
doubtless according to an understanding, made no nomination, thus
virtually throwing the party vote over to Mr. Donnelly, who had been
named as the candidate of the Greenback Labor party. Ignoring national
issues, Mr. Donnelly appeared as the champion of the Minnesota farmers
oppressed by the railroads and the Minneapolis Millers’ Association. It
was charged and widely credited that this organization was fixing the
prices of wheat at every railroad station in the state. This it was
doing by direct dictation to buyers, and also indirectly through the
making of grades. There was in use for inspection and grading a small
cylindrical vessel of brass with an attached scale beam, which the
farmers were told could be so manipulated by a practiced hand that it
would yield three grades of wheat from the same bag full. It was
charged that the association buyers not only undergraded, but also
reduced the prices for lower grades out of all just proportion. Mr.
Donnelly never had a finer opportunity for the exercise of his
unequaled powers of ridicule and invective. He denounced his opponent
as the willing tool of the corporations and the Millers’ Association.
He perambulated the district haranguing great crowds, whom he convulsed
with scornful tirades upon “the swindling brass kittle.”
The “brass kittle campaign,” however, resulted simply in reducing the
normal Republican majority of the district from 10,000 to 3003 votes.
But Mr. Donnelly obtained a majority of nearly 500 of the country vote.
When Congress met in December, 1879, Mr. Donnelly appeared as a
contestant. He claimed that the count had gone against him by reason of
illegal ballots, of bribery, and of the colonization of voters. The
House committee on elections lingered long in their investigation,
partly because it was diversified with an episode which for the time
attracted more interest than the contest itself. A letter addressed to
the chairman of the committee, Springer of Illinois, made him an offer
of $5000 to keep Washburn in his seat. The authorship was later fixed
by a special committee of investigation on one Finley, a friend of
Donnelly. They did not find that Mr. Donnelly had inspired the letter
or had known that it was to be written and sent. The alleged object, of
course, was to so incense Springer against Mr. Washburn that he would
immediately swing his committee for the innocent contestant.
Still it was a Democratic House, willing, according to abundant
precedent, to seat its partisan contestant if any plausible explanation
could be invented. On the last day of the session two reports came in
from the committee on elections, each signed by five members. The
committee had arrived at no conclusion. The House ordered the reports
printed and recommitted, and that was the last ever heard of the
contest. Mr. Washburn served out the term with great satisfaction to
his constituents, and was accorded two reëlections by majorities which
nobody had occasion to question.
Ignatius Donnelly thus closed his career in national politics. He
appeared later in two or more state legislatures, and was editor of
several short-lived weekly newspapers. In early life he had published a
small volume of poems and some prose essays in which he gave assurance
of literary ability. His occupation as statesman gone, he now turned to
authorship. In the winter of 1880-81 he composed a geographical
romance, entitled “Atlantis, the Lost Continent.” He dressed the
ancient classical legend in such attractive garb as to interest a great
body of readers, serious and other. Many editions have been published.
This work was followed by another, similar in character, under the
title of “Ragnarök.” The author elaborated the ingenious theory that
the mantle of drift covering large portions of the northern hemisphere
had been landed where it lies, when the earth at some time crossed the
orbit of some great meteor. This fascinating book was also widely read.
Mr. Donnelly next took up the study of a question which had already
been among his recreations, that of the authorship of the plays and
poems of Shakespeare. His “Great Cryptogram” of a thousand octavo pages
contains the results of “an incalculable labor, reaching through many
weary years.” In the first part of King Henry the Fourth, Mr. Donnelly
professed to have discovered the key to an involved cipher showing that
Francis Bacon, Nicholas Bacon’s son, had a mysterious connection with
that work, although making no clear and direct claim to its authorship.
There was a bewildering array of “root numbers” and “modifying
numbers,” beyond the understanding of the wayfaring man. No hidden
secrets were revealed by the ingenious and complicated computations,
and no additions to historical knowledge were obtained. But Mr.
Donnelly only claimed to have made a small beginning of a great work
left to future investigators. The book, however, excited great interest
among people concerned with the Bacon-Shakespeare controversy, and
formed a notable addition to that literature. In 1889 the indefatigable
author brought out a novel under the title “Cæsar’s Column,” being a
graphic and horrible picture of the fancied results of the sway of an
unbridled plutocracy in America. Published at a happy moment, the book
was sold by hundreds of thousands of copies, not only in America but in
translated versions in Europe. The first edition appeared under the
name of Edmund Boisgilbert, and the author had no little difficulty in
finding a publisher. In another novel, “Dr. Huguet,” the author
appealed for a humaner treatment of people of color, but the public did
not respond by buying largely. Later ephemeral volumes and pamphlets
added nothing to the repute of a Minnesota author known wherever the
English tongue was spoken.
* * * * *
The superintendent of public instruction during the Pillsbury
administrations was the Rev. David Burt. Although his education was
clerical and his educational experience brief, by a conscientious
devotion to the novel duties he carried forward successfully the work
of his predecessors. He did much to annul the chronic opposition to the
normal schools, and justified the regents of the university in asking
more liberal appropriations for buildings and appliances, in spite of
the small numbers of its early graduating classes. He persuaded the
legislature with no little persistence that the common school fund
should be distributed to the districts according to the number of
children attending, and not according to the census of those of school
age.
The legislature of 1877, acting under an amendment to the constitution
adopted two years before, extended to women the right to vote on all
measures relating to schools, including the choice of school officers;
and “to hold any office pertaining solely to the management of
schools.” A later constitutional change extended this privilege to
library officers and measures. It has been effectively exercised in but
few instances.
In his annual message for 1874 Governor Austin advised the legislature
that the text-books used in the common schools were sold to parents at
exorbitant prices fixed by a convention of the publishing craft, but
made no definite suggestion for relief. Ignatius Donnelly, who was in
the state senate continuously from 1874 to 1878, took the lead in an
effort to emancipate the people from the tyranny of the school-book
ring. His favorite plan was to have the state print books prepared by
competent experts and distribute them free to the schools. Two bills
for this purpose were passed by the senate and defeated in the house.
In 1877 a well-known book dealer of St. Paul came forward with a
proposition to furnish text-books as good as those in use for half the
prices exacted, provided he could have a fifteen-year contract. To this
the legislature agreed, and the contract was made and executed. Mr.
Donnelly’s biographer claims that the saving to the state in that term
was at least $2,839,765. There is no positive evidence of the
allegations that large amounts of money were used to defeat the bill.
In all the territories of the Northwest as they were successively
carved out of the old Northwest Territory, provisions were made in
their organic acts for universities, to be endowed by grants of land
from the general government. That universities could not in fact appear
and exist until after the development of fitting schools did not
trouble the pioneers, intent chiefly on getting the lands. The reliance
of American colleges generally for the preparation of their students
had been upon the excellent academies, controlled or countenanced by
Christian denominations, which were the ornaments of so many eastern
villages. The academy did not multiply nor flourish in the West.
Ambitious cities existing on highly colored lithographic maps could
tolerate nothing less than a college or university. A score of them
were chartered in Minnesota in the fifties. All the western colleges
were obliged to open preparatory departments, and it may be said that
they have never done more useful service than in thus setting patterns
for the secondary education of the future. When the University of
Minnesota began college work in 1869 there were practically no
efficient preparatory schools in the state. After a study of the
situation the president of the university formed the opinion that it
was to the budding high schools of the state that the university must
look for its supply of students prepared for college work. At the state
teachers’ convention of 1872 that body was asked by a committee from
the board of regents to join in an endeavor to bring about a vital
organic connection between the high schools and the university. It was
not proposed that these schools should be made over into mere “fitting
schools,” but that, while performing their great function as “people’s
colleges,” they should accommodate those worthy, and ambitious youth
desirous to carry their school and professional educations still
farther. The idea was not unwelcome, but it was not easy to work out a
plan of vital, organic connection. Yet one was worked out, embodied in
a bill drawn by the head of the university, and laid before the
legislature of 1878. The law enacted provided for a money payment out
of the state treasury to any high school which, having the proper
faculty and equipment, would maintain preparatory courses of study, and
admit thereto pupils of both sexes from any part of the state, free of
tuition. The schools were obliged to submit to inspection and make
reports to the “high school board.” The high schools of cities and
villages were thus employed as the state’s agencies for extending free
secondary education to all the youth of the state. A beginning was made
under the law in the year of its passage, but owing to an omission in
an appropriation bill it was not put into full and effective operation
till 1881. The results have fully equaled all reasonable expectations.
The university, the high schools, and the common schools of Minnesota
have been converted from a loose aggregation into a complete,
harmonious, organized system. There is open to every child of the state
a course of free school education from the kindergarten to the
doctorate of philosophy.
* * * * *
On May 2, 1878, soon after seven o’clock in the evening an explosion
took place in the Washburn flour mill in Minneapolis. The report was
heard at great distances, the windows in neighboring streets were
shattered, and not one stone of the great building was left on another
above the foundations. Two other mills of less capacity, standing near,
blew up within a few seconds, and three others took fire and were
completely destroyed. It was the hour for the change of shift of day to
night crews, or many more than eighteen men would have lost their
lives. The insurance companies, when called upon to pay their losses,
demurred, taking the ground that they had insured against fire only,
and not against chemical explosion. Mr. Louis Peck, the instructor in
physics in the University of Minnesota, attracted by the problem,
conducted an exhaustive course of experiments to ascertain the truth of
the matter. Some of them were exhibited to the public. His conclusion
was that the mills were destroyed by a true fire. He found that any
carbonaceous dust, flour, starch, or even sawdust, diffused through the
atmosphere, would take fire and burn with an incalculable rapidity from
a spark or flame. His testimony compelled the payment of the
insurances. The statement of a Minnesota historian that this excellent
bit of scientific work was done by a professor in Berlin is erroneous.
Even more disastrous was a fire which on November 15, 1880, destroyed a
wing of the hospital for the insane at St. Peter. Twenty-seven patients
lost their lives. The state capitol, erected in 1853, took fire in the
evening of March 1, 1881, while the senate was in session, and was
completely destroyed. Fortunately no lives were lost, but the senators
made their escape none too soon. The ceiling fell as the last of them
reached the street.
The Fourth of July, 1880, was the two hundredth anniversary of the
discovery of the Falls of St. Anthony by Father Louis Hennepin. The
event was commemorated by a celebration held on the university campus,
under the management of the Minnesota Historical Society, General
Sibley presiding. The principal address was delivered by Mr. Cushman K.
Davis. Archbishop Ireland charitably defended the Franciscan father
from charges of untruthfulness on the ground that unauthorized
interpolations were made in his original book. General William T.
Sherman was present, and was heard in some happy extemporaneous remarks.
* * * * *
The reader already knows how the people of Minnesota, believing
themselves to have been tricked and swindled by a combination of
corrupt politicians and greedy railroad operators, forbade in 1860, by
a constitutional amendment, their legislature to make any provision for
redeeming the special Minnesota state railroad bonds without their
affirmative vote. The holders of the bonds refrained from attempts to
secure recognition of their claims till after the close of the Civil
War. The legislature of 1866 yielded to their urgency so far as to
appoint a commission to ascertain who were then holding the bonds and
at what prices they had obtained them. The working members of the
commission were John Nicols and General Lucius F. Hubbard. It was in
this year that the discovery occurred of 500,000 acres of public land
coming to the state under the forgotten act of 1841. On Governor
Marshall’s recommendation the legislature of 1867, without waiting for
the report of the Nicols commission, joyously devoted those acres to
the redemption of the bonds. Under the constitutional amendment of 1860
the act had to run the gauntlet of popular vote. The electors turned
down the bill by a decisive majority.
The Nicols commission reported to the legislature of 1868 that they had
found 1840 of the 2275 bonds in the hands or control of 106 persons.
The largest holder was Selah Chamberlain of Ohio, who had held the
largest contracts for construction. He averred that his bonds had cost
him “more than par” for work done and material furnished; and claimed
the whole amount with interest to date as justly due him. Other holders
had obtained their bonds by purchase as low as seventeen and one half
cents on the dollar. In response to allegations frequently repeated,
that the grading done by Mr. Chamberlain for three of the four
companies had never cost $9500 a mile, the commission employed an
experienced engineer to examine the work and make an estimate of what
it should reasonably have cost. His figure was $2843.42 per mile. The
report of the Nicols commission did much to confirm the Minnesota
people in the conviction that the men who had tricked and cheated them
had no standing as honest creditors. Governor Marshall, however,
believing that the innocent holders for value at least had just claims,
urged the legislature to use the internal improvement lands to satisfy
their claims. An absurd bill of 1869 he felt obliged to disapprove.
Another of 1870, passed in response to an appeal in his closing
message, proposing to turn over the lands at a price which would
produce a sum sufficient to pay the bonds, became a law and was
ratified by a large majority of the electors voting thereon. The
legislature had imposed the condition that the act should not be in
effect until at least 2000 bonds had been offered for redemption. But
1032 were turned in, and the act was futile. Governor Austin expressed
his regret that the bondholders were unwilling to accept so “fair and
equitable a compromise.” The legislature of 1871 entertained a new
proposition. The bill introduced provided for a commission whose first
duty should be to ascertain and decide whether the bonds were a legal
and equitable obligation against the state. If the decision should be
affirmative, the commission was to award to each holder the amount due
him on the basis of cost, and deliver to him proper amount of new state
bonds. The railroad taxes were to be devoted to the redemption of the
new bonds. General Sibley had left his retirement and taken a seat in
the house of representatives because of his desire to see the old bond
matter settled. He had never wavered from his opinion that the state
was a debtor to the full amount of the bonds issued. But for his
influence the bill could not have passed. He would not believe that
Minnesota would not at some time pay what she had promised to pay.
Could he so believe, he declared in his speech, he would emigrate to
some community in which he would not suffer the “intolerable
humiliation” of living in a “repudiating state frowned on by a just and
righteous God and abhorred by man.” Governor Austin, although he
sympathized with the popular feeling, did not disapprove the bill, but
let it go to be mercilessly slaughtered at the polls. The people would
not pay mere paper obligations without right or equity behind them.
Such they held the bonds to be.
Having failed to obtain satisfaction from the political authorities,
the claimants presently resorted to the courts. In 1873 Mr.
Chamberlain, their representative, sued the St. Paul and Sioux City
Railroad Company to recover from that company as assignee of a portion
of the land grant, which he claimed to be still subject to the
mortgages authorized by the “five million loan bill.” The decision went
against him in the Circuit Court of the United States, and he took an
appeal to the Supreme Court, to be there finally defeated. Both of
these courts, however, took opportunity to declare that the bonds were
legal obligations, and that if the state of Minnesota were suable no
court of justice could refuse to adjudge her to pay. “Justice and honor
alike” bound her to redeem her bonds. The state of Minnesota was thus
branded by the highest judicial tribunals of the land as a defaulting,
repudiating state, regardless of the claims of honor and justice. These
opinions—they were not decrees—had little effect on the Minnesota
people, most of whom never heard of them, but they did affect the minds
of many of her public men, who smarted under the reproaches they could
not help but hear. Governor Davis in his retiring message urged the
establishment of a commission to arbitrate between the bondholders and
the state. Governor Pillsbury in his inaugural address urged the
payment of the bonds in full, to redeem the reputation of the state. To
these appeals the legislators gave no heed. To the legislature of 1877
Mr. Chamberlain for himself and others submitted an offer to cut their
claims in two and accept new six per cent. bonds in payment. To this
the legislature promptly agreed, but the electors in the following
November put their veto on the bill. They did the same thing to an act
of 1878 providing for an exchange of internal improvement lands for the
bonds, differing in particulars from a previous act of the same general
tenor.
In his messages of 1879 and 1881 Governor Pillsbury, under the heading
of “Dishonored Bonds,” entreated and implored the legislatures to pay
the honest debt of the state and clear her tarnished honor. His earnest
and impressive appeals had no effect on the former of the two, but the
legislature of 1881 was moved to provide for a special tribunal, to be
composed of judges of the supreme and district courts, to consider and
decide whether the repudiating amendment of 1860 was binding on the
legislature. If the tribunal should hold in the negative, then the old
bonds were to be redeemed by new ones at fifty per cent. of the amount
nominally due. Not one of the judges of the Supreme Court was willing
to serve, and the tribunal was tardily made up of five district judges
designated by the governor. The tribunal met and organized, and nothing
more. An order from the Supreme Court required it to show cause why a
writ of prohibition should not issue, on the ground that the
legislature had not the right to establish such a tribunal. The
attorney-general at the same time protested against its competency, and
had leave to protest further that the act was repugnant to the
constitutional amendment of 1860, which forbade payment of the bonds
unless after an affirmative vote of the electors. This pleading brought
forward as the principal issue the validity of that amendment. The
contentions were exhaustively argued in the Supreme Court by able
counsel. The decision of the court was that the repudiating amendment
of 1860 was obnoxious to that provision of the constitution of the
United States forbidding states from passing any law impairing the
obligations of contracts. The writ of prohibition issued and the
tribunal dissolved. There was no appeal, and the Minnesota legislature
was free to dispose of the bond matter without a referendum. Governor
Pillsbury called that body to meet on October 11. The bondholders were
ready and anxious to accept fifty cents on the dollar. A bill to issue
new 10-30 four and one half per cent. “Minnesota state railroad
adjustment bonds,” to a sufficient amount, was passed after some
contention as to details. A companion bill devoting the proceeds of the
500,000 acres of internal improvement land was passed, and under
constitutional requirement submitted to the electors in November, 1884.
The vote stood: Yes, 31,011; no, 13,589. The presidential vote of the
state in 1880 was 150,484. This vote, therefore, did not indicate so
much a change of sentiment among the people as a willingness to have
the old bond controversy quieted. The state’s power to borrow at
reasonable interest had never been affected. Good judges were of
opinion that the bondholders fared very well and could afford the
liberal expenditures made to secure the legislation. The amount of new
bonds issued was $4,253,000, of which Mr. S. Chamberlain received
$1,992,053.70. Governor Pillsbury closed his third term by signing
them, a duty he performed with great satisfaction. With this he retired
from office, except that he served on the board of regents of the
university till his death in 1902, the legislature having by special
act created him an additional regent during his good pleasure. He had
been on that board since 1863.