When The Feds Are At Your Door

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PETER: This is BackStory. I’m Peter Onuf. Campaign season is heating up, and with it concerns about the amount of corporate money flooding modern elections. Critics call it legalized corruption. But as Teddy Roosevelt learned more than a century ago, if you want a seat at the table, it can be hard to stay clean.

MALE SPEAKER: Here was the President of the United States caught with his hand in the corporate cookie jar.

PETER: Today on the show, we’re looking at charges and countercharges of political corruption. We’ll visit the nation’s early days, when fears about corrupt politicians took on a life of their own.

JOANNE FREEMAN: Ironically, the inability to find corruption ups the idea that it really must be there.

PETER: And we’ll consider the gray area that makes one man’s corruption another man’s good governance.

MALE SPEAKER: Why is there a bargain if my action happens to help you and your action happens to help me?

PETER: A history of political corruption. Don’t go away.

Major funding for BackStory is provided by an anonymous donor, the University of Virginia, the National Endowment for the Humanities, and the Joseph and Robert Cornell Memorial Foundation.

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MALE SPEAKER: From the Virginia Foundation for the Humanities, this is BackStory with the American Backstory hosts.

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BRIAN: Welcome to the show. I’m Brian Balogh, and I’m here with Peter Onuf.

PETER: Hey, Brian.

BRIAN: And Ed Ayers is with us.

ED: Gentlemen.

BRIAN: We’re going to start the show off today with a guy who gets a lot of calls in his job.

ELLIOT BERKE: The calls really are of one or two varieties. One is, I am in trouble, the FBI knocked on my door, what do I do–

BRIAN: This is Elliot Berke, a lawyer in Washington DC. Among other things, Berke specializes in congressional ethics.

ELLIOT BERKE: –or hey, I’ve assumed some office or we’re taking on some new initiative, and we want to make sure we don’t have any problems moving forward.

ED: Berke basically helps elected officials and staffers figure out if what they’re doing or have done is corrupt. And whether or not you’re corrupt might seem like a pretty simple thing to figure out, but this is, after all, Washington, DC. A few years ago, a congressional staffer came to him with this predicament. Does she face any ethics issue in accepting an engagement ring?

ELLIOT BERKE: If your boyfriend or girlfriend wants to propose to you, and gives you a ring, technically speaking that needs to be pre-cleared by the ethics committees.

ED: Why? Because before any Congress member or staffer receives a gift worth more than $375, first it has to be cleared.

BRIAN: Unless, says Berke, the recipient can prove the gift is from a personal friend. And even that can get complicated in the social world of Washington, where the dating world often encompasses K Street and Capitol Hill.

ELLIOT BERKE: I had a conversation with one of the ethics councils in which I was told that it was actually better if you were living with your boyfriend or girlfriend, because then it shows a history of sort of sharing the rent and, you know, reciprocal gifts back and forth than if you were living apart.

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PETER: I love it.

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ED: Berke says that a lot of these convoluted rules are the product of various scandals that have rocked Capitol Hill over the years.

ELLIOT BERKE: Most of what we still see are knee jerk reactions to scandal that creates very arcane and, I think, impractical rules to address something that, had proper enforcement been in play, you know, the laws on the books and the rules on the books could have addressed the situation.

ED: A recent example, says Berke, is the reformed triggered by the Jack Abramoff lobbying scandal a few years back.

BRIAN: Now, you will remember that Jack Abramoff was a lobbyist who admitted to lavishing Congress members with gifts in exchange for votes that benefited his clients. And soon after passing this particular set of reforms, the House Ethics Committee sent out a memo clarifying some of the new rules.

ELLIOT BERKE: In this memo, they said that a member may accept a $15 baseball cap with a corporate logo of a company, but they could not accept a $12 coffee mug from the same company with the same logo. I don’t know if a coffee mug has a greater utility than a baseball cap, but while we appreciate the clarity on that point, it still can be very frustrating to try to explain to somebody that, you know, that’s where they ended up.

BRIAN: Elliot, that’s such a partisan slam, baseball versus cappuccino. I mean, come on.

ELLIOT BERKE: Well, I enjoy both.

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ED: Now, Berke does believe that there should be strong ethics guidelines on the books, but he also thinks that the current Band-Aid system of reform means that he has to spend a whole lot of time parsing the difference between mugs and caps, while truly questionable deals don’t get noticed at all. Consider this example. Under current rules, a lobbyist is not allowed to take a lawmaker out to lunch unless the lunch is just a lunch.

ELLIOT BERKE: They can turn around and take that member of Congress as a candidate to lunch as a fundraiser and pass him a $500 check. That’s perfectly permissible. But I’m not sure, from a civic perspective, that that’s the most sensible environment to operate.

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PETER: It’s tough to find anyone who will actually go to bat for political corruption. But what exactly constitutes corruption is a question that has bedeviled many generations of Americans, going all the way back to the very beginning.

ED: And so today on the show, we’re holding our noses and doing a deep dive on corruption. How have people defined it over the years, and why has the spectre of corruption always seemed to loom so large in our politics? Have things gotten any less corrupt or more corrupt over the course of our history?

PETER: We’ll start, as we often do, in the founding period. This was a time when fears of corruption loomed extremely large. After all, the Revolution itself had been a kind of mass mobilization against corruption in England. American patriots believed that evil government ministers and royal advisers with selfish intentions were warping the way the system was supposed to work. The United States was going to be a fresh start.

This was the context for a dinner party that took place in April of 1791 at Thomas Jefferson’s house in Philadelphia. Jefferson was the Secretary of State, and his guests were Vice President John Adams and Secretary of the Treasury Alexander Hamilton. Yale historian Joanne Freeman is going to pick up the story from here.

JOANNE FREEMAN: They’re chatting, I guess, as founders are wont to do, about the British constitution, casually. And Adams says, purge the British constitution of its corruption and give its popular branch equality of representation and it would be the most perfect government on the face of the earth.

PETER: Ooh, well now Jefferson wouldn’t like that, would he?

JOANNE FREEMAN: Jefferson is not going to like that. Jefferson is not going to think that the British monarchy is the most perfect government on the face of the Earth.

PETER: We did have a revolution.

JOANNE FREEMAN: Yeah.

PETER: Yeah, OK.

JOANNE FREEMAN: We kind of went against the monarchy thing.

PETER: Right, but that’s not the worst of it, because then Hamilton opens his mouth–

JOANNE FREEMAN: Yeah–

PETER: –which he does often.

JOANNE FREEMAN: –Hamilton’s good at opening his mouth. So Hamilton then says, oh, no, no no, keep the corruption and introduce some equality into that popular branch and it would be the most perfect government on the face of the Earth.

PETER: Now hold it, he says hooray for corruption?

JOANNE FREEMAN: He at least says we need corruption.

PETER: Yeah, OK. Explain that, Joanne.

JOANNE FREEMAN: Well to Hamilton, corruption equals practical politics. I mean, to Hamilton, it’s one thing to talk about ideals, it’s another thing to get politics done. And so in a way, what Hamilton is talking about is what, in his mind, he would conceive of as the reality of wheeling and dealing in politics, the fact that stuff happens behind the scenes, people give and take, and that that’s the real world, Jefferson, and that’s how politics works.

PETER: OK, so corruption is good because it means dealmaking.

JOANNE FREEMAN: Yeah. Well, it means sort of removing the brakes of the public government and allowing things to happen behind the scenes.

PETER: Now of course, you’re casting Jefferson as totally shocked. What’s troubling Jefferson? Is it that he thinks that corruption somehow is going to interfere with representative government, that government won’t represent the people if it’s corrupted?

JOANNE FREEMAN: Yeah, I think that’s what he thinks. And I think he actually then thinks that that’s what happens, that congressmen have been corrupted by Hamilton, that they’re going to use insider knowledge somehow and run around collecting IOUs from war veterans because they know the government is going to actually function and pay them back.

PETER: Right.

JOANNE FREEMAN: And these veterans are selling them at a really reduced rate. And so basically, he thinks that what Hamilton is really trying to do is corrupt, in a way, I guess, the government itself. By making the government into what he wants it to be, that he’s going to make it more powerful, more centralized, more nationalized than it’s ever intended to be. And he’ll do that by finding ways to corrupt officials.

PETER: Right. So this is really a debate about the nature of power itself in the new republic, and what have we done, what’s the real constitution going to be like. It’s not just the thing that’s written on paper, it’s the way power is actually exercised.

JOANNE FREEMAN: Exactly. I mean, one of the great things about studying this period is that they don’t just worry about that sort of stuff, they worry about it really consciously. Like, on paper. Like, what do you think about the use of power in the government?

PETER: Yeah, exactly.

JOANNE FREEMAN: And you know, one of the ways in which that plays out, which seems ridiculous to us but seemed important to them, is they’re worried about procedures. Who talks to who, and where, and when. And so it’s not, in a way, surprising that European diplomats often say that they’d rather chat with Hamilton because he’s willing to just go into a room and do whatever needs to be done, whereas Jefferson very much wants to be following the proper channel out in the open.

Actually, Washington, who’s being very careful as first president, does the same thing. A French minister comes up to him and says he wants to talk in private with him, and Washington says, well, no, you’re supposed to first talk to the Secretary of State. And when this minister says, no, you don’t understand, I just want to talk with you, Washington basically says no. You know, that’s not the way the system works. They’re trying very hard to be accountable as to who has power and where the power is.

PETER: OK. So Jefferson is really concerned about what Hamilton is doing to the government. He has suspicions about how he might be pulling the strings, and really subverting the independence of the representatives of the people. And he launches a campaign to try to, in effect, expose the scandal of corruption. Tell us how that works out, Joanne.

JOANNE FREEMAN: Right. Well, he wants to sort of figure out where all of the corruption is, but he does not do this himself.

PETER: No, he wouldn’t, of course. That would be corrupt.

JOANNE FREEMAN: Of course he wouldn’t. He And this is right. Well, this is what Hamilton accuses Jefferson of being sort of sneaky and corrupt because he’s always doing everything behind the scenes, and he doesn’t ever step up and do it in public. So Hamilton would say, yeah, see, there he goes again.

PETER: Right, he’s corrupt, too.

JOANNE FREEMAN: Yeah.

PETER: OK, so this is one of the first big efforts to expose corruption in American history. And it’s not the last.

JOANNE FREEMAN: No.

PETER: Tell us about this.

JOANNE FREEMAN: Well, Jefferson gets an ally of his from Virginia named William Branch Giles to propose a series– basically, a series of resolutions in Congress querying certain things about Hamilton’s behavior, about what he’s done in the Treasury Department and where the money has gone and who’s been moving it. And essentially, it’s a series of resolutions that’s going to force Hamilton to come out in the open and absolutely declare where the money is going, and why and how it’s gone there.

PETER: So what happens? This must be sensational. It’s like the Watergate of its era.

JOANNE FREEMAN: Well right, it is a big deal. And Hamilton is really crotchety. There’s all these letters from him in which he’s like, you know, I could be doing Treasury work, but no, I’m writing reports showing how I didn’t do things that I didn’t do. In the end, Hamilton is very happy to report that there’s no proof of anything. He comes out crystal clear, having written a bazillion reports and shown, in his mind, where all the money’s gone.

There isn’t corruption proven. I don’t think that that persuades Jefferson and his friends for a moment that there isn’t corruption. He just thinks they haven’t managed to put their finger on it.

PETER: Yeah. So the failure of this campaign to expose corruption in the Washington administration doesn’t put an end to these concerns about corruption. What’s the upshot of this failure to expose the bad guys?

JOANNE FREEMAN: Well, I mean, ironically, the inability to find corruption ups the idea that it really must be there.

PETER: It’s really corrupt.

JOANNE FREEMAN: Exactly. It’s so corrupt, we can’t see it.

PETER: Yeah. Well, I mean, eventually, isn’t it true that Republicans in Congress in Washington’s second administration have concluded that Washington himself is a dupe of the corrupters?

JOANNE FREEMAN: Well, that’s true, people begin to suspect that– not that he’s corrupt, but that– just as you put it, that he’s been duped by sneaky ministers like Hamilton.

PETER: And this is the great irony of the American founding, the American Revolution and experiment in Republican government, is that the people get their government, but they don’t believe it’s their government. So the big party division emerges between the governors, the people who are trying to make things happen, and then those who suspect their motives. So Republican self-government doesn’t lead to this era of enlightenment and moral progress, it leads to a new kind of profound division over the very nature of power.

JOANNE FREEMAN: Right. So one of the many ironies of this period is they want to launch this wonderful new thing, but because it’s wonderful and new, it’s scary, it’s upsetting, they’re not sure it works, and it sort of spirals into this environment of charges and countercharges and accusations and fear of corruption and proof of corruption. And Hamilton might even say that people like Jefferson and his ilk are corrupting the public by pandering to them, by being demagogues, by promising them things that they can’t have, and thus getting their power and then doing whatever the heck they want.

PETER: So this is the unthinkable conclusion that Hamilton is suggesting, and that is ultimately the problem with Republican government is the people themselves who are subject to manipulation and corruption. So there’s no pure source of good government in the people. And that would be the most deeply troubling thing to Jefferson, wouldn’t it?

JOANNE FREEMAN: That would be. The Hamilton draws that conclusion after the presidential election of 1800, when the presidency goes to Jefferson and Hamilton I think in 1802 is trying to figure out, what the heck did we do wrong. And one of the things he says is we should have pandered to the people, because the people are vain and they’ll always respond to that, and the Republicans are great at that kind of, essentially, corruption.

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PETER: Joanne Freeman is a professor of history at Yale University.

BRIAN: It’s time for a short break. When we get back, how one man’s routine meeting is another man’s shady backroom deal.

ED: You’re listening to BackStory. Don’t go away.

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PETER: We’re back with BackStory, the show that looks to the past to understand the America of today. I’m Peter Onuf.

BRIAN: I’m Brian Balogh.

ED: And I’m Ed Ayers. Today on the show, On The Take– a history of political corruption in America.

PETER: In 1824, four candidates duked it out for the presidency of the United States, but it was clear this was really a contest between two men, Tennessee’s Andrew Jackson and John Quincy Adams of Massachusetts. Jackson, widely known as the hero of the Battle of New Orleans in the War of 1812, won the popular vote. But even though Jackson won more votes than the other candidates, he fell short of the number of Electoral College votes needed to assume the presidency.

ED: And so the decision was thrown to the House of Representatives. And this is where things got interesting. It turns out that the guy who came in fourth place– dead last– was also the Speaker of the House, Kentucky’s Henry Clay. And since he wielded so much power in Congress, Clay was now in a position to effectively choose the next commander in chief.

DANIEL FELLER: Clay announced that he would support Adams, even though the two had had, politically and personally, almost nothing in common before this.

ED: This is historian Daniel Feller.

DANIEL FELLER: That made him president, and then he immediately turned around and appointed Henry Clay Secretary of State. The last three secretaries of state in a row, including Adams, had become president, so it looked like a simple quid pro quo. I’m Henry Clay, I make you president, you make me president next.

ED: I sat down with Feller to discuss this episode, one that would go down in history as the Corrupt Bargain of 1824. He told me that many Americans were outraged, and no one more so than Andrew Jackson himself.

DANIEL FELLER: Jackson, as soon as he learned not that Adams had been elected, he actually took that with some good grace, but as soon as Adams then announced Clay as Secretary of State, Jackson just exploded. Jackson certainly believed that, as the other Westerner in the campaign, that Clay should have thrown his support to him. And in a famous letter, he said– and now I am quoting him– so you see, the Judas of the West has closed the contract and will receive the 30 pieces of silver. Was there ever witnessed such a bare-faced corruption in any country before.

ED: So how does the so-called Corrupt Bargain of 1824 compare to or relate to what we think of corruption today?

DANIEL FELLER: The word corruption today we normally associate with mere monetary or financial gain. You know, graft.

ED: Right.

DANIEL FELLER: When Jackson talked about bare-faced corruption, he was not talking about money. What he was really talking about– and this idea goes back to earlier American history, and before that to English history, the idea that government is not serving the purposes for which it’s intended, that it’s not serving the people’s will, that it is instead dealing favors out.

ED: So Dan, I hear several elements here that makes this sound corrupt, is that Jackson got more than anybody else, right, so it kind of feels like he should be able to be president, and I also hear that the fourth place guy just sort of comes in and gets this plum job. So I would say, on the surface of it, it looks corrupt to me.

DANIEL FELLER: It looked corrupt to a lot of people. It certainly looked corrupt to Andrew Jackson. Now, the other side of that, if you look at it from Clay and Adams’ point of view, Clay actually announced publicly before the election in the House that he was going to support Adams. And he did so on transparent grounds. He said, like him or not, John Quincy Adams is an accomplished statesman. There’s no doubt that he is qualified for the job, whereas Andrew Jackson is a mere– and these were Clay’s words– military chieftain.

The American republic was still young at the time. People were very aware of the fragility and the failure of past republics. And one thing that had done republics in, from ancient Greece and ancient Rome down to recent France, was the man on horseback, the military hero who comes in and rides roughshod over the republic and the liberties of the people. And Andrew Jackson, throughout his career, had shown a remarkable ability to ignore or override civilian authority, to take the law into his own hands.

ED: Not to mention all those people he killed in duels and things, right?

DANIEL FELLER: Well, he actually only killed one in a duel, but–

ED: Oh, OK.

DANIEL FELLER: –there were others he would have liked to have killed. So there’s no reason– let me put it differently. There is, from Clay’s point of view, every good reason why, despite their political differences, he should support Adams. And then who is Adams going to appoint Secretary of State? In fact, there was nobody in the country who, by dint of inclination and interest and qualifications, was better suited to the job than Clay. Clay had wanted to be Secretary of State for years. It’s kind of like if I do something for good reason and you do something for good reason, and in both cases we do it independently of each other for good reasons, why is there a bargain if my action happens to help you and your action happens to help me.

ED: So what we need to figure out is how this really pretty elaborate dance, it sounds, between the two politicians– nobody is not being honest about what it is they want and need, but on the other hand, there’s no quid pro quo about a position, right– so how does it become known then as the Corrupt Bargain?

DANIEL FELLER: By 1824, there was a groundswell building up in the States– and this was even before the so-called Corrupt Bargain– demanding that the people be heard, that the people get to choose the president, that the will of the people out in the hinterlands should be observed. In light of that kind of groundswell of demand for, in a word, democracy, to have this election at this particular moment apparently decided by a handful of guys in a back room, in a Congressional cloakroom, stank.

ED: Right.

DANIEL FELLER: And one of the many ironies of this election is that Henry Clay had to do penance for the rest of his life for what he had done here. The cloud of making a corrupt bargain really tainted his entire public career after this. Possibly, that was the thing that kept him from becoming president. And yet, Clay had every good reason to think that this was the most self-sacrificing, patriotic statesman-like thing he ever did.

ED: So if we were to pull the camera back and look at this from the broad view of American history, why does this episode of the Corrupt Bargain and its aftermath really matter?

DANIEL FELLER: Well, I think it matters because of the lesson that it sent, which is politicians– today we would call them perhaps inside the beltway politicians–

ED: Right.

DANIEL FELLER: –do not represent the people. They will deal away your interests, they will thwart your will if given a chance. It’s the prototypical story of the backroom deal that deprives the people of their choice. And the election of 1824 left us with the idea that any such kind of arrangement, what you might call normal political horse trading, is actually corruption.

I think every time a candidate today runs against Washington, every time a candidate says not vote for me because I know my way around the United States Senate, but instead vote for me because I don’t know my way around the United States Senate, vote for me because I have not been polluted and corrupted and compromised by what’s going on in Washington, that is an echo of 1824.

ED: Dan, thanks so much for unraveling this remarkable episode.

DANIEL FELLER: Thank you. It’s been a pleasure.

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ED: Daniel Feller is a history professor and director of the papers of Andrew Jackson at the University of Tennessee.

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BRIAN: Ed, it seems so ironic that, right after this corrupt bargain, we get the origins of a system that is also associated with corruption. That’s the spoils system that comes in with Andrew Jackson in 1828.

ED: It just sounds corrupt, doesn’t it? Spoils, right?

BRIAN: Exactly.

ED: You know, the spoils of war, but it also sounds like it spoils American politics.

BRIAN: Yeah.

ED: And the idea is, hey, listen, Brian. OK, I’m Andrew Jackson. You saw the big problem was that it was these guys cutting the deal in the dark. Here’s what I’m going to do. I’m going to tell everybody you support me, I’ll support you. If you’re a newspaper editor or a modern office holder anywhere in the country, and you support the great democratic upsurge of Andrew Jackson, hey, there will be something in it for you, because this is the way democracy work.

BRIAN: And what’s in it is a contract or a position, right?

ED: Yeah.

BRIAN: That’s not corrupt?

ED: Well, no, rather than– because it’s going to be right out in the open. Everybody’s going to know why you got it. You got it because you supported the winner.

PETER: And the government is supposed to be for the people, so what’s corrupt about the people being their own governors? That’s what the whole principle of democracy is about, isn’t it? The people spoke. And corruption has absolutely nothing to do with it. It’s way out in the open, as Ed says. It’s transparent. This is the people acting.

BRIAN: So Peter, it sounds like it got Jackson off the hook. Clear sailing, right? Transparency for all.

PETER: No. Unfortunately for him, Brian, the Whigs mobilized against Jackson because they think he wants to be king. That is the organizing metaphor for American politics. There’s somebody in there who wants to take the government away from us and make himself king. And by pandering to the people, the populist Jackson in fact is making a move toward monarchical power.

In other words, they’re turning the same charge against Jackson that Jackson–

BRIAN: I see.

PETER: –had turned against Adams.

ED: Yeah, Peter, but it’s amazing how much the Whigs actually adopt the Democratic ideals of the spoils system, right?

PETER: Right.

ED: Because you can’t govern a place the size of the United States without actually distributing political power, without having agents, basically editors– and that was the critical element in Jackson’s–

PETER: Yes, indeed.

ED: –spoils system. Unless you have editors advocating for you in virtually every county in America, you can’t possibly put together a winning coalition.

PETER: And what did editors get out of elections? Did they get printing contracts?

ED: Yeah, which are basically what allows the newspapers to exist, right?

PETER: Right.

ED: And they’re very explicit about it. So picking up on your theme, Peter, the editors put on the masthead, we are a Democrat, a Whig, a Republican, a Know-Nothing, whatever. And so then when the Republicans come along in the late 1850s, they know how to do it. And they build something that Jackson would have said, yes, this is exactly what I was talking about, right?

And then they use that to win the Civil War. Then they use that to build reconstruction. Then they use it to create the economic machine that creates Gilded Age America. So the transparency, Brian, that Andrew Jackson wanted ends up becoming clear to everybody. And the result? Voter turnout that is off the charts, party identification that is off the charts. And that system actually flourishes so well that then it becomes the object of reformers who kind of want to get back to the John Quincy Adams idea of who you need running things are people who actually know stuff, and not just know people, but know things.

BRIAN: That’s right. And if you want to know whether somebody knows something or not, you give them a test. That was called a civil service test. And that came in, for some people, with the Pendleton Act in 1883. But I think as important as the Civil Service Act and the test was what was happening in corporations at the time, what was happening in other large organizations.

They were trying to manage really large, national operations. And so was the government. A big pension system, a set of forests that stretched across the country. And so they needed to find people who could be trusted to manage these resources, regardless of party. You needed people who actually knew how to build dams. You needed people who actually knew how to build roads, and do it in the most efficient way. At least that’s what the voters were beginning to say.

PETER: So there’s a broad recognition that there are limits to what democratic politics can do efficiently.

BRIAN: That’s right. And perhaps the biggest change, Peter and Ed, is that, you know, Feller referred to politicians inside the beltway. At the end of the 19th century is when politicians began to hand things over to bureaucrats, experts, quote objective people, and blaming them for anything that went wrong.

PETER: Right.

BRIAN: And certainly once we got these experts increasingly involved in things and making decisions, very far away from political parties or the voter booths, we had a precipitous dropoff in the number of people who actually turned out and vote. It’s almost as if they said, we don’t matter anymore, and they knew it.

ED: It’s almost as if they said, there’s no spoils, what’s the point.

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BRIAN: If you’re just joining us, this is BackStory, and we’re talking about how past generations of Americans thought about corruption over the years.

PETER: One way that we try to keep our government officials from making deals or taking bribes is to pay them good salaries and offer them job security. But for many decades, government offices were actually for profit, meaning that government employees weren’t on salary, but rather were paid in bonuses and fees based on how well they did their jobs.

BRIAN: This lasted for a long time, through much of the 19th century, in fact. But at the very same time, Americans’ ideas about government work were gradually shifting, culminating finally in the salary system we take for granted today. Legal scholar Nicholas Parrillo has written about this little remembered chapter of history, and explained to me that there were actually two types of pay for government service.

NICHOLAS PARRILLO: On the one hand, you had some government officers who were paid on a profit-seeking basis to do things that people didn’t want, OK? So the prosecutors receiving a fee for every conviction they won would be an example of that. So would tax collectors getting a percentage on all the evasions they discovered, or on all the forfeitures they imposed on people.

BRIAN: So that was kind of like a bounty.

NICHOLAS PARRILLO: Exactly. You could think of these officers as, in a sense, bounty hunters. And basically the more unpopular the law they were being asked to enforce, the higher the fee would be. So you might get, say, a $10 fee for prosecuting a misdemeanor, a $20 fee for prosecuting an ordinary felony, but if you brought a prosecution and won it under the prohibition laws or the anti-gambling laws, you might get a fee of $50 or $100 or something like that.

And I mean, I think this is interesting because, although we today think of profit-seeking in government as sounding generally kind of corrupt, these kinds of incentives were actually an effort to counter corruption. They were an incentive to get the officer to follow the law and enforce the law to the hilt, to the letter.

BRIAN: So the corruption entailed was simply doing what was easiest, and not doing what might get you run out of town.

NICHOLAS PARRILLO: Right, right, right. Exactly. And by giving people a monetary incentive to enforce the law to the hilt and to the letter, that was anti-corruption. That was an early foray into efforts at good government. And then on the other hand, the other half of the dichotomy would be government officers who were paid on a profit-seeking basis for providing services to people who wanted those services.

The government land officers who had to make decisions about whether settlers had fulfilled the requirements to get a homestead would be paid a fee when they granted the homestead. Another example would be the officers who decided immigrants’ applications to become citizens. And the idea was that these officers are providing a kind of private service that helps private people out. And a way of inducing them to provide good service and serve their customers is to pay them a fee, and maybe even negotiate a fee.

BRIAN: But if I went to the DMV and paid the person behind the desk my $17, and that person put the money in their pocket, I would call that fraud.

NICHOLAS PARRILLO: Yeah, or corruption.

BRIAN: Yeah.

NICHOLAS PARRILLO: For that not to be corrupt, you have to have a quite different conception of government office than we have now. You can’t really view officers as creatures of a legislature or of a centralized government the way we view them today. You have to view them as sort of quasi independent vendors, you know, whose obligation is to just kind of reach workable arrangements with the people who need their services. It’s not about providing kind of uniform service to everybody.

BRIAN: So they’re almost like mediators today.

NICHOLAS PARRILLO: Yeah. Yeah. Yeah. But something new happens with how people think about government offices by the early 19th century. They start to think, well, actually these offices– they aren’t businesses, they’re creations of the government. They have no existence apart from the elected lawmakers who supposedly create them. And therefore, officers should only be able to take a fee for their service if the legislature actually establishes the fee in an act that it passes as a law.

I mean, there’s a hilarious incident in which the federal government land officers wrote to their bosses and said, look, the settlers applying for homesteads would like us to help them fill out their forms. And we’re really good at helping people fill out their forms. We deal with these forms all day. Can we take a fee for helping these people fill out their forms? The settlers want to pay us this fee because, you know, they think they’re going to have to pay more if they go to some private attorney, or if they don’t get any help, they might do it wrong, you know, or something like that.

BRIAN: Yeah, no, they’re the original H&R Block.

NICHOLAS PARRILLO: Exactly. And the bosses write back and they say, Congress has not authorized you to take a fee for helping people to fill out their forms. You can only take the fees on the list. It would be nice if you helped people fill out their forms, but Congress has not authorized it, it’s not in the law, you cannot take anything.

You know, I mean, the aspiration was for these fees for service to continue to imbue the government with customer service. But once you have the legislature saying, look, we want to control this, we want to kind of confirm our own supremacy, they’ve got to regulate everything. And that’s really hard to do in a way that continues to be customer serving.

BRIAN: Is that how we get salaries? Does Congress throw up their hands and say, oh my god, what a mess we’ve gotten ourselves into.

NICHOLAS PARRILLO: Yeah, I think that’s ultimately one of the major reasons. It became a sort of logistically impossible regulatory task. And of course, government officers would often not listen to their bosses. They wouldn’t listen to the legislature. They’d continue to strike deals on an individualized basis.

But now, after this ideological change involving all this stuff about legislative supremacy, that comes to be labeled as corrupt. So when you observe what contemporaries in history call big increases in corruption, often you’re not actually observing a change in behavior, you’re observing the same behavior, but people are looking at it differently, with a different and new set of expectations.

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BRIAN: Nicholas Parrillo is a law professor at Yale. He’s the author of Against the Profit Motive– the Salary Revolution in American Government.

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It’s time for another short break. When we get back, how a little profiteering during the Civil War led Americans to see the spectre of corruption around every corner.

PETER: You’re listening to BackStory. We’ll be back in a moment.

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We’re back with BackStory. I’m Peter Onuf.

BRIAN: I’m Brian Balogh.

ED: And I’m Ed Ayers. We’re talking today about political corruption, both real and imagined, throughout American history.

PETER: Over the years, a lot of concern about corruption has stemmed from government contracting work. The perception, at the very least, is that Americans are getting short-changed because of corrupt deals between bureaucrats and contractors doing shoddy work. As it turns out, it was the Civil War that spawned the usage of the word shoddy to refer to government contracting. As BackStory producer Andrew Parsons discovered, the word quickly came to stand for a whole lot more.

ANDREW PARSONS: Before the Civil War, the word shoddy referred to cloth made from old scraps of woolen goods and oil. It was cheap, but not necessarily bad. Then, in 1861, the war hit, and the government scrambled to prepare.

MICHAEL SMITH: They’re basically having to make contracts for firearms, for clothes, for horses, from essentially anybody that’s willing to sell them these products.

ANDREW PARSONS: This is Michael Smith, a historian at McNeese University. He says Union soldiers began to write home about problems with their government-issued supplies.

MICHAEL SMITH: Uniforms that fall apart in the rain or shoes that come apart on the march. In many cases, kind of defective weapons. Also, food for the troops, you know, can be stale or spoiled.

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ANDREW PARSONS: This was shoddy’s first shift in meaning. What once referred to shabby cloth now referred to every piece of equipment offered to Union soldiers. Smith said this turned into a real scandal, especially since the North was losing major battles at the time.

MICHAEL SMITH: Eventually, Secretary of War Simon Cameron loses his job for his poor management of this. And the Northern government does, for the most part, straighten this out after 1861, and greatly improves their business procedures.

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ANDREW PARSONS: Now, it’s not that war profiteering disappeared all together at this point, but it was precisely when it was becoming less and less common that the word shoddy started to be thrown around more and more.

MICHAEL SMITH: Shoddy kind of takes on this other connotation, right, that opponents of the war, critics of Lincoln, even members of Lincoln’s own party conceived it as this kind of moral rot, basically, that’s infecting the war effort. And not just harming the war effort, but really kind of corrupting Northern society, with people putting their own interests above those of the nation.

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MALE SPEAKER: This is the age of shoddy. They belong to the shoddy party and support the shoddy administration, which is conducting this shoddy war for the profit and perpetuation of a shoddy dynasty.

ANDREW PARSONS: This is from the New York Tribune, a Democratic newspaper that wielded the word against Lincoln’s Republican administration. Shoddy became the Benghazi of its time, a single word packed with emotions and meaning. And by 1863, the concept sunk into American pop culture with a popular novel called The Days of Shoddy.

MICHAEL SMITH: The Days of Shoddy, this kind of melodramatic, kind of overstuffed Victorian novel.

ANDREW PARSONS: The villain is an evil business owner who steals the main character’s wife while he’s at war. And, you guessed it.

MICHAEL SMITH: He is a government contractor who provides inferior goods to the army at the Battle of Bull Run.

ANDREW PARSONS: Now, this novel was also written by a Democrat, but Smith says concerns about the shoddiness of the war effort extended to members of Lincoln’s own party, too. Corruption became a national obsession.

MICHAEL SMITH: It kind of spiraled out of control into people basically saying the war came about because of political corruption. Essentially, the war is sort of God’s judgment for these moral failings.

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ANDREW PARSONS: And that obsession had implications. As late as 1865, Congress and the military were spending a lot of time and energy trying to ferret out cases of shoddiness. Often, these were instances of a simple accounting mistake or cutting corners. But men were court martialed anyway. In one case, Lincoln had to step in to issue a pardon.

MICHAEL SMITH: He basically said it’s beyond the power of rational belief that this guy, on a million-dollar contract, defrauded the government of $100. That’s not– you know, people are essentially blowing this out of proportion.

ANDREW PARSONS: So you might be wondering, during a time when the Union’s fate hinged on a campaign against the South, why all the suspicion against Washington itself? Smith says it goes back to the Revolutionary War.

MICHAEL SMITH: You see government power as corrupting, right? That’s what Jefferson and the revolutionaries believe, that power is inherently corrupting. Men will be corrupted by it, can’t be trusted with power for too long.

ANDREW PARSONS: And since the Civil War was the largest expansion of the US army and the Treasury and the federal government that the nation had ever seen, it triggered alarm bells.

MICHAEL SMITH: Well, if there’s inefficiency, if there’s fraud, that means you have bad men that have been corrupted by power. And we have to be really, really vigilant. Americans in the 19th century essentially think this is the lesson of history, and this is sort of what they have to guard against.

ANDREW PARSONS: In the end, many Northerners thought the very future of the republic hinged not just on victory over the South, but on overcoming its own shoddy nature.

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ED: Andrew Parsons is one of our producers. We also heard from McNeese University historian Michael Smith, who tells the story of shoddy in his book, The Enemy Within– Fears of Corruption in the Civil War North.

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BRIAN: Campaign finance reform is a phrase we hear a lot of today. Proponents of such measures argue that our entire political system is in danger of being corrupted by the enormous amounts of corporate money pouring into modern campaigns. That concern is not a new one, and attempts to reform the system go back more than 100 years.

In 1907, Congress passed the first major campaign finance legislation. It was called the Tillman Act. And joining me now to explain whose hand was in the till is legal scholar Adam Winkler. Adam, welcome to the show.

ADAM WINKLER: Thanks for having me on.

BRIAN: So this Tillman Act, that was a response to what a lot of people saw as a real problem around the turn of the century. Was the problem created by a specific incident? Often today, you know, there’s some scandal, and it produces this whole wave of reform.

ADAM WINKLER: Indeed. There was a huge scandal in 1905 that showed that insurance companies were donating policyholders’ money to elections, especially the re-election campaign of President Teddy Roosevelt.

BRIAN: I thought that Teddy Roosevelt made his reputation for cleaning up corruption. It turns out he was on the take?

ADAM WINKLER: Well, Teddy Roosevelt had this image of a trust buster. But before he had the image of a trust buster, he had the image of someone who was on the make from corporations. It was the presidential election of 1904 that raised particular controversy. When it came out that the life insurance companies were giving huge contributions in excess of– in today’s dollars– in excess of $2 million. That led to nationwide outrage.

BRIAN: Do people think the practices of these corporations are corrupt? I don’t mean just in terms of payoffs to politicians, but in terms of using stockholders’ funds to try to influence politics. Do they use the stockholders’ money corruptly?

ADAM WINKLER: Absolutely. We have to remember that this is the period where we see the rise of the modern corporation, with modern stockholders, where people are investing through the stock market, and also we see a huge number of people who are investing in insurance companies as policyholders. That’s the way, basically, they provided for their retirement in an era before pensions and before Social Security.

And so you have this modern corporation where you’re separating, increasingly, ownership from control. And the mass of owners have very, very little power over their corporation. And what they’re finding with the campaign finance scandals of the early 1900s is that their money is being used to finance politics against their will.

And indeed, there were a lot of Democrats, for instance, among the insurance company policyholders. And their money was being used to help elect Republicans. And so many people thought this was really the height of corruption. It wasn’t just the corporations were buying influence, but they were buying influence with your money in ways that were designed to reduce your power.

And this set off a huge scandal. At the time, it was called the Scandal of the Century. Of course, the century would have plenty more scandals to come. But this really put pressure on Republicans, especially Teddy Roosevelt, to adopt campaign finance reform.

BRIAN: Adam, so what is this Tillman Act, and does it work?

ADAM WINKLER: The Tillman Act is a law that bans corporations from giving anything of value to a candidate for federal office. And the law is effective in reducing corporate money directly from the corporate till. However, individual contributions were not banned. And so candidates just went to the heads of the big corporations and insurance companies and asked them to give huge personal contributions. And indeed, at that time, most election campaigns were financed by just a handful of very, very wealthy people.

BRIAN: Adam, I want to return to Teddy Roosevelt’s– well, to use a contemporary political term– flip-flop. It seems to me that, even then, there was this pattern of politicians who would like to be known as crusading against corruption. That’s certainly what Teddy Roosevelt did when he was a local politician and a state politician, and that was his reputation.

These politicians make a career crusading against corruption, yet they’re kind of forced to play ball with that corrupt system. Do you think that’s true, and do you think that’s the problem with getting any traction on campaign finance reform today?

ADAM WINKLER: I think that is true, Brian. And in many ways, candidates can suffer a certain cognitive dissonance. You know, they don’t necessarily see their votes as being up for sale, so they don’t view the money they receive as being corrupt. And I think that was the case with Teddy Roosevelt.

He thought of himself as a trust buster who was going to break up the big corporations. Yet when the corporations gave him money, he said, well, I’m not going to sell anything to them, so I need that money, that helps me get elected and do good things for the people. So when it comes to money and politics, I think politicians generally just don’t see money as being all that corrupt because they don’t view themselves as being corrupt and as willing to sell their votes for the highest bidder.

BRIAN: Sounds to me like the politicians trust themselves a lot more than the American public does.

ADAM WINKLER: That’s a great way of putting it.

BRIAN: Adam, thanks for joining us today on BackStory. And I want you to know the check’s in the mail.

ADAM WINKLER: [LAUGHING] Thanks so much, Brian.

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BRIAN: Adam Winkler is a legal scholar at UCLA. He’s working on a book about corporations and corporate personhood.

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One good turn deserves another. Be my love, I’ll be your lover. It’s all part of nature’s law. If you scratch my back, then I’ll scratch yours.

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ED: That’s going to do it for us today. But we’re eager to hear your thoughts about political corruption. Leave us a comment on our website. And while you’re there, we’d love for you to weigh in on our future show topics. Later this month, we’ll be taking on World War I and all that came in its wake.

So far, we’ve got public relations, jazz music, IQ tests, and chemical weapons. What else would you add to our list?

PETER: Let us know at backstoryradio.org. You can also reach us via Facebook and Twitter, or by email. Our address is backstory@virginia.edu. Whatever you do, don’t be a stranger.

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Do a favor for me, I’ll do one in return.

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ED: Today’s episode of BackStory was produced by Tony Field, Nina Earnest, Andrew Parsons, Kelly Jones, and Bruce [? Wallis. ?] Emily Gadek is our digital producer, and Jamal Millner is our engineer. We had help from Sam [? Olmsynder. ?] BackStory’s executive producer is Andrew Wyndham.

BRIAN: Before we leave today, we want to extend a special welcome to our afternoon listeners on WAMU in Washington, DC. And for all you Washingtonians who used to set your alarms for six in the morning to listen to BackStory on Sunday, well, you can now sleep in.

PETER: Major support for BackStory is provided by an anonymous donor, the University of Virginia, the National Endowment for the Humanities, and the Joseph and Robert Cornell Memorial Foundation. Additional funding is provided by Weinstein Properties, by the Tomato Fund cultivating fresh ideas for the arts, the humanities, and the environment, and by History Channel, history made every day.

FEMALE SPEAKER: Brian Balogh is Professor of History at the University of Virginia. Peter Onuf is Professor of History Emeritus at UVA, and Senior Research Fellow at Monticello. Ed Ayers is President and Professor of History at the University of Richmond. BackStory was created by Andrew Wyndham for the Virginia Foundation for the Humanities.

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–like two peas in a pack. Let’s get rid of our itch together. If you scratch my back, then I’ll–

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